Roche Weighs Divestment of $1.9 Billion Cancer Data Startup, Reports FT by Reuters

Swiss pharmaceutical company Roche is reportedly exploring the possibility of divesting its cancer data specialist, Flatiron Health, according to a report from the Financial Times citing unnamed sources.

Roche acquired the New York-based Flatiron Health for $1.9 billion in 2018, with the intent of accelerating its development of cancer treatments and supporting initiatives to price medications based on their effectiveness.

Currently, Roche is collaborating with Citigroup to evaluate options for Flatiron, which may include selling the business or finding a partner to take a stake in the company and assist in its operations. The report indicates that Roche has maintained Flatiron as a separate legal entity; however, its ownership has reportedly made some competitor drugmakers wary of collaborating with the startup, adversely affecting its sales.

The departure of several Roche executives who were integral to the initial acquisition has led to a decrease in advocacy for Flatiron within the Swiss company, according to the report.

A Roche spokesperson stated that the company does not comment on rumors. Citigroup has also opted not to provide any comments, and Flatiron has not responded yet.

Flatiron, previously supported by Alphabet, utilizes data from individual cancer cases to assist physicians in determining beneficial treatment options for their patients. The company also manages billing records, physicians’ notes, and other pertinent information.

The news of Roche considering the divestment follows the company’s recent increase in its full-year earnings forecast, attributed to strong demand for its newer medications, such as the eye treatment Vabysmo.